Chinese Megvii blacklisted in US to go ahead with US$1B IPO

HONG KONG, Oct 17, 2019, Bloomberg, The Standard. Chinese artificial intelligence startup Megvii Technology is going ahead with plans for an initial public offering in Hong Kong and a listing hearing in early November, despite being blacklisted by the Trump administration. The Alibaba Group-backed company is aiming to raise between US$500 million (HK$3.9 billion) and US$1 billion and become the third listed company with weighted voting rights in Hong Kong, reported The Standard.

The Trump administration blacklisted eight Chinese companies this month, including Megvii, accusing them of being implicated in human rights violations in the Xinjiang region.

Megvii’s IPO filing included about 40 pages of risk factors ranging from competitive threats to the dangers of AI. One entry cited the possibility of the U.S. imposing trade restrictions on the company.

Goldman Sachs, one of three underwriters on the IPO, said last week that it was evaluating its involvement. Megvii is also working with JPMorgan and Citigroup.

Meanwhile, mainland biotech firm Ascentage Pharma has launched its initial public offering to raise up to HK$417 million.

The Jiangsu-based company is issuing 12.18 million shares at an indicative price range of HK$32.2 to HK$34.2 per share. The minimum investment is HK$3,454.46, with a board lot of 100 shares.

Ascentage attracted Sino Biopharmaceutical (1177), which agreed to subscribe to HK$156.8 million worth of shares, as its cornerstone investor.

The company is mainly engaged in developing new therapies for cancer, hepatitis B, and age-related diseases, and plans to start trading on the main board on October 28.

Newly listed companies continued to outperform the market yesterday. Shares of CR Construction (1582) rose 15 percent to HK$1.15 while Hong Kong Johnson (1955) surged 23 percent to HK$1.23 on their first trading day.

Green Future Food Hydrocolloid Marine Science (1084) rose 43.1 percent to HK$1.66 in the Bright Smart gray market before its debut last night.

Share it


Exclusive: Beyond the Covid-19 world's coverage